Best Home Warranty Companies of 2020

The best home warranties help cover the payment for repairs on systems and appliances so you can avoid unexpected and costly bills. With so many home warranty providers to choose from, it’s difficult to know which one is ideal for you. In this comprehensive guide, we compare the best home warranty companies of 2020 to help you find the right plan at a cost you’re comfortable with.

7 best home warranty companies for 2020

Compare home warranty companies

CompanyWhy we chose itNumber of covered itemsService feeWaiting periodBBB rating
Choice Home WarrantyEditor's Choice26$8530 daysB-
American Home ShieldBest Customizable Plans27$75–$12530 daysB
Select Home WarrantyMost Cost-Effective Plans24$7530 daysB
First American Home WarrantyBest HVAC Coverage27$75–$10030 daysB+
America's 1st Choice Home ClubBest Workmanship Guarantee24$75–$12530 daysB
The Home Service ClubBest for Immediate Coverage53$75–$9530 daysN/A
2-10 Home Buyer's WarrantyBest for New Construction Homes29$850 daysA

Editor’s Choice: Choice Home Warranty

Choice Home Warranty

  • 2 plans available + optional add-ons
  • Has over 10 years of industry experience
  • 90-day repair guarantee
  • $36–$44 per month

Why we chose CHW

Choice Home Warranty is one of the best home warranties in the industry, providing comprehensive plans at competitive pricing. Choice offers two plans—a Basic Plan and a Total Plan—both of which include appliances (like a clothes washer and dryer) and systems (such as plumbing and electrical). Customers also have the option to customize add-ons.

Choice Home Warranty does not deny coverage based on the age of your home or covered items as long as you’ve taken good care of them, making the company a great choice for older homes.

Best customizable plans: American Home Shield

American Home Shield

  • 4 plans + add-ons and the option to build your own plan
  • Customers can choose the service fee they want to pay
  • Provides generous coverage caps
  • $50–$55 per month

Why we chose AHS

American Home Shield founded the home warranty industry and has been in business for almost 50 years, making it one of the most trusted providers we’ve reviewed. We found them to be the best for customizable plans. The company offers four plans: Appliance Plan, Systems Plan, Combo Plan, and a Build Your Own Plan. With these options, customers can select the plan that best fits their home protection needs. AHS also provides extra coverage for items like a pool, spa, or guest house up to 750 square feet.

Additionally, AHS has an extremely efficient claims process. According to the company, it approves and assigns professionals to a customer’s service request within the first 24 hours of the claim 98% of the time—this is faster than any other home warranty provider in the industry.

Most cost-effective plans: Select Home Warranty

Select Home Warranty

  • 3 plans + optional add-ons
  • Offers free roof leak coverage
  • Low service fees compared to other home warranty companies
  • $36–$38 per month

Why we chose Select

Select Home Warranty offers coverage for items most companies don’t, including roof leak protection and septic system coverage. It has three plans—Bronze Care, Gold Care, and Platinum Care—that start as low as $36 a month.

Not to mention, this company has some of the lowest monthly premiums and service fees in the home warranty industry. It also runs popular promotions, like including two months free or taking $100 off of your total cost when you sign up for an annual plan. These factors made it easy to name Select the best for cost-effective plans. 

Best HVAC coverage: First American

First American Home Warranty

  • 2 plans + optional add-ons
  • Covers improperly installed or maintained items
  • No cap on coverage for HVAC
  • $28–$43 per month

 

Why we chose FAHW

First American’s coverage of improperly installed or maintained appliances and systems is a unique perk that most home warranty companies don’t offer. With the company’s First Class Upgrade, your 13-year-old Rheem water heater would be covered even if hasn’t been maintained properly. Note: most companies don’t cover appliances or systems that haven’t had routine maintenance or items that were incorrectly installed or modified.

Best workmanship guarantee: America’s 1st Choice Home Club

America's 1st Choice Home Club

  • 4 plans + optional add-ons
  • Allows customers to choose their own pre-approved service contractor
  • Has the longest work guarantee in the industry, guaranteeing parts and labor for the life of your membership
  • $38–$50 per month

Why we chose AFC Home Club

AFC Home Club is one of the top home warranty companies in the industry for comprehensive coverage and personalized service. It offers four plans, which is twice as many as most companies offer. Customers can choose from Systems (systems plan), Silver (appliance plan), Gold (combo plan), or Platinum (comprehensive plan). You can also build your own plan by choosing from a list of optional add-ons.

Of the companies we reviewed, most require customers to wait until the provider connects them with an approved contractor within its network. America’s 1st Choice allows customers to choose their own service provider. That means if you already know a plumber who does an excellent job, you can be reimbursed for hiring them to fix a covered item.

Best for immediate coverage: The Home Service Club

The Home Service Club

  • 2 plans + optional add-ons
  • 10-day waiting period
  • Quick turnaround on claims
  • $46–$61 per month

Why we chose HSC

The Home Service Club has a short waiting period, a fast claims process, and responsive customer service—all factors that make the home warranty process seamless for the customer and easy for us to name them the best company for immediate service. HSC offers two plans: Standard and Comprehensive Coverage. The company also offers some unique add-ons that you can pay extra for, such as utility lines, outside power, sewer, water, and irrigation lines.

Best for new construction homes: 2-10 Home Buyers Warranty

2-10 Home Buyers Warranty

  • 3 plans + optional add-ons + structural plans
  • User-friendly online customer portal
  • BBB-accredited with an A rating
  • $34–$46 per month

Why we chose 2-10

With 39 years of experience and an A rating from the Better Business Bureau, 2-10 Home Buyers Warranty is one of the most trusted companies, offsetting costs for important home systems and appliances and providing affordable structural coverage for new homes.

Homeowners can choose between three plans from 2-10 HBW as well as a list of 10 optional add-ons. The company also offers structural home warranty plans to builders, so of you recently built a home, we suggest 2-10 Home Buyers Warranty to protect your new investment and named it our best for new construction homes.

How to choose the best home warranty

Home warranties can help save you hundreds of dollars on repairs and replacements of major home systems and appliances. When buying a home warranty, you want to ensure you’re enrolling in a home protection that makes sense for you with a company you trust. Before signing up for a home warranty, take the following factors into consideration.

1. Consider what coverage you need

Most home warranty providers offer three levels of coverage. Some split their plans by the number of items covered (basic plans, combo plans, and à la carte options) while others divide coverage by the type of item (appliance plans versus system plans). It’s important to shop around and choose the best plan that covers the most items you have in your home.

Compare what common coverage plans offer below:

  • Basic plans: This include the major systems and/or appliances that you use every day. Typically, these plans will cover heating, AC, ductwork, electrical systems (e.g. garage door opener), plumbing system, stoppages, water heater, clothes washer and dryer, dishwasher, oven/range/cooktop, built-in microwave, and refrigerator. This plan is best for homeowners who want coverage on the core components of their home.
  • Combo plans: This is upgraded coverage (also known as “combination plans”) that includes everything under a basic plan, plus additional items. Additional items may include coverage on alarm wiring, built-in food centers, central vacuum, doorbells, smoke detectors, sump pump, trash compactor, water dispenser, and whirlpool bathtubs. This is the best for homeowners who want total home protection for all of their appliances and systems. 
  • Optional add-ons: This allows you to customize your coverage and build your own plan. Popular add-ons include a second refrigerator or water heater, limited roof leaks, pool and spa equipment, stand-alone freezers, water softener, and well pumps. This is a good option for homeowners with special features that aren’t standard in most homes. 
  • Appliance plans: These plans typically include coverage for all major appliances in the home (e.g. washer and dryer, oven/range/cooktop, built-in microwave, refrigerator, freestanding ice maker, dishwasher, trash compactor, and garbage disposal). This is ideal for homeowners with old home appliances, but relatively new systems already covered under an extended warranty. 
  • System plans: These plans cover all major home systems (e.g. HVAC, electrical system, plumbing system, stoppages, water heater, central vacuum, doorbell, smoke detectors, ceiling, exhaust, and attic fans). These are good plans for homeowners with old home systems but recently updated appliances that are already covered under a manufacturer’s warranty.

2. Think about the price you’re comfortable with

Home warranties usually cost $25–$67 for each month of coverage. However, you can usually get a better deal if you invest in an annual premium or a three- to five-year plan. One-year renewals are subject to a price increase year after year.

Your home warranty plan will also have a set deductible—also known as a service fee—and it will likely have coverage caps. Most warranty companies charge a non-negotiable, non-refundable service charge of $75–$125 each time a claim is approved.

Cost to repair Cost to replace Potential savings
HVAC $284–$347 $4,249–$5,413 $544–$1,500
Plumbing & toilets $216–$305 $370–$1,038 $643–$656
Water heater $546 $1,065 $1,037
Refrigerator $310 $1,925 $1,306
Oven/range/stove/cooktop $150 $1,675 $1,607
Dishwasher $150 $1,000 $1,683
Clothes washer & dryer $250–$310 $1,075–$1,250 $1,466–$2,932
Well or sump pump $486–$818 $1,138–$1,543 $625–$925

Note: The above repair and replacement costs are based on national averages. We calculated the average amount that customers can save by compiling sample contracts from the top providers we’ve reviewed.

 

 

 

In 2018, 40% of American adults reported they don’t have enough savings to cover a $400 emergency bill. To most of us, $30 a month for a home protection plan sounds much more manageable than a $1,000 dishwasher replacement.

Advice from industry experts

Coverage plans guard against costly repairs and lend peace of mind, which is why we at House Method think they’re worth it. Here’s what our expert advisors have to say.

A realtor's perspective

When helping my clients decide whether a home warranty would be a good idea or not, we take a look together at the items that would be covered to try and decide if this is something of value.  If there’s a concern that an HVAC system or appliance is nearing the end of life, then it’s likely that the warranty will come in handy.  I have had clients who never used the warranty, but have also had many clients benefit from having this and were thankful it was in place.

Jennifer Vaught, Realtor at Rossi & Taylor Group

A repair professional's recommendations

  • Read the fine print in your contract so you understand what is covered and what is not.
  • Don’t blame the contractor for a denied claim. They’re just following the instructions of the company.
  • Conduct regular home maintenance, like replacing your air filters. This can save you your copay amount.
  • Read reviews on the company you’re considering. Reviews are a good source for knowing the good, the bad, and the ugly so you know what you’re getting into.

Michael Stimpson, Owner of Snowflake Air

An attorney's opinion

Generally speaking, I’d argue that they are 100% necessary. Your house, after all, is likely the largest purchases you’ll ever make. It’s extremely important that you take whatever measures necessary to protect that investment.

Ryan B. Bormaster, Managing Attorney at Bormaster Law

Mr. Handyman's advice

Understand what your plan includes, and what it does not.  Consistent maintenance and repair of your home are important. Keeping gutters clean, windows and doors caulked, fixing minor damage before it becomes major damage, etc.  Does the warranty you are considering cover this kind of work, or only fixing things after the damage has occurred? Are there depreciation schedules, exclusions, or things (lack of maintenance) that void the warranty?  Don’t just assume what’s covered—know what’s covered.

Mike McCalley, Owner of Mr. Handyman

Are home warranties worth it?

A home warranty makes sense for many homeowners. Not only do they protect you in the event of an unexpected system or appliance breakdown, they save you hundreds of dollars on repair and replacement costs and provide peace of mind.

To better understand what draws homeowners to purchase home warranties, we surveyed more than 1,000 policyholders about when and why they chose to buy their plans. Here’s what we found from the survey results.

Who benefits from a home warranty plan

  • Homeowners on a budget—59% of homeowners who have a home warranty purchased a service contract because they were unsure they would be able to afford the cost of repairs without it.
  • First-time homeowners—66% of customers purchased their contracts at the time of their home sale. Since buying a home can be overwhelming and expensive, this makes a lot of sense. On closing day, you’ll likely have a tight budget and a long list of home improvement projects to do. 
  • Owners of older homes—Things break over time. Your house gets that lovely lived-in look, but your appliances will eventually cave to years of wear and tear.
  • Owners of mobile homes—Home warranties also apply to mobile or manufactured homes. No matter how small your home’s footprint is, you can still protect your investment with a mobile home warranty.
  • Novice do-it-yourselfers—Some homeowners attempt to fix items themselves because they can’t afford to hire a professional. Repairs by an unskilled party can be dangerous to the person conducting them and can cause even greater harm to the system or appliance. Customers have access to a network of local professionals who can get the job done quickly and efficiently.
  • Home sellers—A home warranty covers unexpected repairs while your house is on the market, so you can keep it up and running for potential buyers. It’s also a great marketing tool since sellers can transfer the warranty to the buyers. One-year plans offer buyers coverage for their first year in their new house.
  • Real estate agents—You can buy a home warranty any time after closing, but many homeowners buy coverage during a home sale. As mentioned above, a plan can be an incentive to those looking to buy, but feeling wary about potential repairs. As a listing agent, it might also ease your mind knowing that the sellers who you’re representing can fix issues that come up while the house is for sale.
  • Rental property owners—Coverage is also convenient for rental property owners who lease houses to tenants, like college students. You can even bake the price of a plan into your tenants’ overall rental fees. If you rent multiple properties, you can expedite maintenance by submitting claims through an 800 number that’s often available 24/7. 

Who may not benefit from a home warranty

  • Homeowners who have 1% of the home purchase price saved for home repairs (i.e. a $300,000 home would need a $3,000 repair budget)
  • Homeowners whose newly built home is already covered by a builder’s warranty
  • Homeowners with appliances and systems are protected under a manufacturer’s warranty

Home Warranty FAQ

What is a home warranty?

A home warranty—also known as home appliance insurance or home repair insurance—is a service agreement that helps protect your major systems and appliances and saves you money on unexpected repairs and replacements.

Most plans last for 12 months. At the end of the contract term, customers can renew their plan.

How does a home warranty work?

If one of your covered household items breaks unexpectedly, file a claim with your home warranty company either online or over the phone. Note: Most companies require customers to submit a claim within three days of the system or appliance breaking. The best home warranties are open 24/7/365 and approve claims within 24 to 48 hours, but other companies will make customers wait up to four days on weekends and holidays.

Once your claim is approved by the home warranty company, they’ll either send one of their approved technicians to your house to diagnose the issue or allow you to choose your own contractor for repairs. The contractor will recommend a repair or replacement for your broken system or appliance.

During this service visit, you’ll pay the contractor a service fee of $75–$100 and the warranty company will cover the rest of the repair or replacement costs.

What's the cancellation policy for home warranties?

You can usually cancel at any time and receive a refund of the amount you don’t use. Ask the company about cancellation policies and fees. We’ve seen fees range from $50 to $100.

What's the difference between a home warranty and homeowner's insurance?

Homeowners insurance, also known as home insurance, is required by most mortgage lenders and has premiums that are usually bundled with your monthly mortgage payment. While home insurance covers structural damage as a result of a fire, natural disaster, or other situations outside your control, a home warranty covers core appliances and systems within your home when they malfunction due to age or normal wear and tear.

You could go a lifetime without making a homeowners insurance claim whereas the average homeowner files two home warranty claims per year.

Do I need to get a home warranty if I already have a manufacturer's warranty?

Manufacturer’s warranties cover individual appliances or systems and are issued by the manufacturer of that particular product. Three common complaints of manufacturer’s warranties are that there’s coverage for only one item, the coverage is non-transferable, and they typically cost more money in the long run.

Registering for a manufacturer’s warranty for each item separately adds up fast and coverage usually only lasts one to two years, whereas a home warranty plan will cover all of your appliances and systems under one renewable plan.

Our conclusion

Our team at House Method stands by our ratings and reviews of the home warranty companies listed in this article and would recommend all of them to those who are looking to buy one. However, if you’re still on the fence about which home warranty company to go with, we encourage you to read the individual provider reviews to get a more in-depth look at the coverage, costs, and unique benefits of each business and find the ideal home warranty for you.

Our review process

At House Method, transparency and trust are our most important values for the reader. That’s why we took the time to create an objective rating system and score each home warranty provider according to our methodology. Here’s what the process looked like:

  • We spent hours on the phone speaking to sales agents from market-leading brands to compare quotes, understand protection plan offerings, and evaluate customer service.
  • We surveyed over 1,000 homeowners to determine what coverage is most important to them when it comes to home warranties.
  • We analyzed sample contracts from each of the brands we reviewed. This helped us break down industry jargon, identify red flags, and understand what is and is not covered.

Finally, we created a rating system to determine the best home warranty companies, which involves a weighted, 100-point scale that scores providers on factors like plans offered, coverage, state availability, cost, trustworthiness, customer service, and unique benefits.

Additional Home Warranty Resources

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Home Warranty Cost – 2020 Plans and Coverage

How much does a home warranty cost? Find out the average price of a one-year home warranty and compare prices from some of the best home warranty providers in the business.

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Home Warranty Coverage – 2020 Plans and Pricing

Home warranty coverage varies depending on where you live, the type of coverage you opt into, and the home warranty company you buy from. Learn what a home warranty covers and how to choose the best policy.

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Cheapest Home Warranty [2020 Update]

We found the cheapest home warranty to save House Method readers time and money. Compare the premiums, service fees, and discounts of the top three home warranty plans available today.

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